Dresdner Kleinwort Capital has structured and led an E41m second round of financing for Kiwwi Holding, a private telecommunications company.
Two Austrian investment companies, Global Equity Partners and Go Equity, also invested in the deal, which is one of the largest venture capital transactions in Austria to date.
The telecommunications industry in Eastern Europe is being liberalised. Vijai Gill, regional director for Central Europe at Dresdner Kleinwort Capital, said: “The two forces of increased telecom liberalisation and convergence towards the EU make the region an attractive investment area. What finally convinced us to invest in Kiwwi was the credibility and track record of the management team. The opportunities will be best realised by smart, proven management who understand both the technology and how to market and sell it to the customer.”
Set up in August 2000, Kiwwi offers small and medium enterprises (SMEs) more affordable access to international telephony and to domestic fixed-line-to-mobile and mobile calls small. It now services 3,000 business telephone customers and 115,000 internet customers in the Czech Republic, Slovakia and Hungary. The company employs 240 people and plans to expand into Poland and Slovenia during the second quarter of 2001. Kiwwi cites independent research which estimates that alternative telecommunications providers will increase their voice services business 35 times by the year 2005.
Arnaud Enee, co-founder and chief executive of Kiwwi, commented: “Our work in the initial stages of liberalisation has convinced our new financial partners that we can deliver infrastructure, customers and revenues as we promised. Within six months of starting up we have established an telecommunications network in three countries, which already meets future technology standards. We are one of the fastest growing telecommunications companies in the Central European region and have ambitious expansion plans for the future.”
Kiwwi secured E11m in its first round of financing which was mainly contributed by US investors.The company operates in Central and Eastern Europe and has its headquarters in Vienna.